1. What is environmental economics?

(a) The branch of economics that studies how environmental and natural resources are developed and managed.

(b) The branch of economics that show how to exploit natural resources as quickly as possible.

(c) The psychological study of relations hip between humans and natural resources.

(d) All above answers are correct.

2. Which of the following is a renewable resource?

(a) Petroleum.

(b) Biological species.

(c) Mineral ore.

(d) soil fertility

3. Which of the following answers is non-renewable natural resource?

(a) Fish and cattle.

(b) Petroleum.

(c) Human resources.

(d) All answers are correct

4. What is it called when government uses laws and regulations to dictate the standards and/or technology to reduce pollution?

(a) Pigouvian Taxes.

(b) Command-and-control regulations (CAC)

(c) Subsidy.

(d) Lawsuits.

5. In case of negative externality, the social marginal cost will

(a) Exceed the private marginal cost

(b) Be equal to private marginal cost

(c) Fall short of private marginal cost

(d) Bear no significant relation to private marginal cost

6. In case of positive externality social marginal cost

(a) exceed private marginal cost

(b) be equal to private marginal cost

(c) have no specific relation to private marginal cost

(d) fall short of private marginal cost

7. Common property

(a) Is owned by specific people

(b) Is inexhaustible

(c) Refers strictly to land resources

(d) Refers to goods owned by society at large and freely used by anyone

8. When consumption of a good is non-rival and non-excludable the good is

(a) public good

(b) mixed good

(c) private good

(d) service

9. Public goods are those goods for which consumption is

(a) Rival

(b) Regulated

(c) Non-rival

(d) Unregulated

10. Pure private goods are those for which consumption is

(a) Non-rival and excludable

(b) Rival and excludable

(c) Rival and non-excludable

(d) Non-rival and non-excludable

11. Which answer below is an example of a positive externality?

(a) Public immunizations.

(b) Increase of corporate taxes.

(c) Issuing extra permits for pollution.

(d) All answers above are correct

12. Which one is not the cause of market failure

(a) Externalities

(b) Imperfect market

(c) Indivisibilities

(d) Pareto optimality

13. Which is not a measure for solution of market failure

(a) Implementation of Property Rights

(b) Direct Control Policy of Govt.

(c) Sale of Pollution Permits

(d) Negative Externalities

14. Which is not among the three types of Property Rights

(a) Private Property Rights

(b) Human Rights

(c) Common Property Rights

(d) Open-access common property

15. A free rider is a person who

(a) Receives the benefits of a good but avoids paying for it

(b) Pays for a good but fails to receive any benefit from the good

(c) Fails to produce good but is allowed to consume goods

(d) Produces a good but fails to receive payment for the good